Once upon a time, the conventional wisdom was that investors should hold stocks as a source of long-term capital appreciation while bonds could bring stability and a stream of meaningful current returns in the form of interest payments. But the appeal of bonds as a source of current income has been diminished by a prolonged period of record low interest rates, pushing yields down and forcing investors to look elsewhere for distributions. In many cases company stock now has distributions that exceed the yield on debt issued by the same entity, a unique phenomenon to say the least. The same scenario plays out for many ETFs; with interest rates at record lows, the current return that can be derived from corporate debt has plummeted. Yet dividend payouts have remained largely untouched, as corporate profits have maintained strength and companies have sought to make a show of stability through a consistent [...] Click here to read the original article on ETFdb.com. Related Posts: Inside The Simple, Surprisingly Effective Dividend ETF Comparing A Dividend ETF With A Dividend Weighted ETF Tax Reform And Dividend ETFs: Cause For Concern? Three ETFs To Watch This Week: IYZ, SMH, XLV 10 Most Useful New ETFs Of 2011 (For Buy-And-Hold Investors)

Once upon a time, the conventional wisdom was that investors should hold stocks as a source of long-term capital appreciation while bonds could bring stability and a stream of meaningful current returns in the form of interest payments. But the appeal of bonds as a source of current income has been diminished by a prolonged period of record low interest rates, pushing yields down and forcing investors to look elsewhere for distributions. In many cases company stock now has distributions that exceed the yield on debt issued by the same entity, a unique phenomenon to say the least. The same scenario plays out for many ETFs; with interest rates at record lows, the current return that can be derived from corporate debt has plummeted. Yet dividend payouts have remained largely untouched, as corporate profits have maintained strength and companies have sought to make a show of stability through a consistent [...]